Mortgage lenders and financial references
Guidance as at 11/01/2016




Lenders which will accept financial references from CIOT and ATT members
New HMRC agreement with the Council of Mortgage Lenders re SA302s
New HMRC are no longer faxing forms SA302s
Example financial reference letter
Members are often asked to assist clients with their mortgage application by providing a financial
reference (see example reference at end of this document). Lenders keep a list of professional
qualifications which they recognise for this purpose. We have concentrated on getting confirmation
of recognition of the CTA and ATT qualifications from the Top 10 lenders by volume (although other
lenders may recognise the qualification it has not been possible to obtain responses from all of the 70
plus lenders we contacted). Please note that the names listed in the table below may include a number
of lenders eg Lloyds Banking Group will include Scottish Widows. If a lender on this list does not
recognise your qualification when it has confirmed to us that it will please let us know by e mailing
[email protected] or [email protected].
TOP TEN LENDERS
Lender
Barclays
Coventry
HSBC
Lloyds Banking
Group
National Australia
Bank (Yorkshire
Bank & Clydesdale
Bank)
Nationwide
RBS
Santander
ACCEPT REFERENCES FROM CIOT
MEMBERS
Yes
Yes
Yes
Yes
ACCEPT REFERENCES FROM ATT MEMBERS
No
No
Yes
Yes
Yes
Yes
Yes
Maybe per Santander
“We do of course appreciate that certain
companies may be exempt from the legal
requirement to have their accounts audited,
and as such those companies may wish to have
their accounts produced by members of the
Association
of
Taxation
Technicians.
Yes
No
Yes
Yes
However where these are prepared and
submitted in support of a lending application,
all cases are looked at on their own merits and
therefore, the Bank reserves it’s rights to make
further enquiries as it seeks fit to satisfy itself
that the information provided is a fair
reflection on the trading performance of the
business which may or may not require
Virgin Money
No
Yorkshire Building
Society
Not on approved list but maybe. Per
YBS “Please note that CIOT and ATT
not being on that list does not mean
we would not accept references from
your members, rather a customer
using one of your members may be
required to provide additional
information to support and evidence
their income”.
accounts to be prepared by a certified or
chartered accountant.”
No
Not on approved list but maybe. Per YBS
“Please note that CIOT and ATT not being on
that list does not mean we would not accept
references from your members, rather a
customer using one of your members may be
required to provide additional information to
support and evidence their income”
We have written back to ask if there is any
additional information we can provide so that
We have written back to ask if there members can be added to the approved list
is any additional information we can
provide so that members can be
added to the approved list
Frequently the mortgage lender will ask for form SA302 as well as, or instead of, a financial reference.
HMRC and the Council of Mortgage Lenders have worked together to agree an approach which should
make the provision of SA302s easier and quicker. Further details are below. In all cases you should
check the individual requirements of the mortgage lender in relation to your client.
HMRC and Council of Mortgage Lenders (CML) agreement
Following the introduction of stricter rules for mortgage applications many lenders have insisted on
having confirmation of income backed up by sight of form SA302. Historically, form SA302 was not
downloadable from the HMRC online system and the only solution was to phone HMRC and request
a copy which inevitably caused delays. Up until now faxed copies of the forms could be requested
but in December 2015 HMRC announced that they will no longer fax forms SA302.
HMRC has been working with the CML to find a solution to this and agreement was reached earlier
this year. A list of those lenders currently participating in this agreement is set out below; if you find
a lender on the list is not adhering to the agreed procedure please let us know.
As evidence to support mortgages, lenders will ask for both the following online documents:


the Tax Calculation
the Tax Year Overview
For those using HMRC software both documents can be printed from the HMRC software.
If you use third party software the tax calculation will have to be printed from that software and the
Tax Year Overview from the SA Online account. Note that HMRC will still provide paper copies on
request.
In support of these changes HMRC have issued three documents which are not available on the
Gov.uk website but are reproduced at the end of this guidance. They are:

HMRC guidance for Lenders - which helps lenders to understand what documentation selfassessment taxpayers can provide about their income and how to interpret it.

Printing your client’s HMRC online Tax Calculation and Tax Year Overview – which provides
agents with the details on how to print a client’s Tax Calculation (where HMRC software is
used) and how to print a client’s Tax Year Overview. HMRC’s understanding is that lenders
will be providing copies of this to agents.

Printing copies of HMRC online Tax Calculation and Tax Year Overview – which sets out for
individuals the steps that they need to go through to print documents.
HMRC has now produced a list of lenders who have signed up to the new procedure as listed below,
The Council of Mortgage lenders is still working to get all lenders and brokers to sign up to the new
process . If you come across a lender or broker who is not signed up or who appears on the list
below but is not operating the new procedure ask them to contact the Council of Mortgage Lenders
but also tell us by emailing [email protected] or [email protected]). If it is a broker please
also provide the name of the lender they are using.
The following lenders have told HMRC that they are now operating the new process as at 9
December 2015.
Aldermore
Bank of Scotland
Britannia
Cheltenham & Gloucester
Co-operative Bank
Danske Bank
Ecology Building Society
Godiva Mortgages Ltd
Holmesdale Building Society
Leeds Building Society
Nationwide Building Society
Newcastle Building Society
Platform
Precise Mortgages
Saffron Building Society
Scottish Building Society
TSB
Wave Lending
Woolwich
Bank of Ireland
Barclays
Birmingham Midshires
Cheshire Mortgage Corporation
Coventry Building Society
Darlington Building Society
GE Money Home Lending
Halifax
Kensington Mortgages
Lloyds Bank Mortgages PLC
National Westminster Bank
Nottingham Building Society
Post Office Ltd
Royal Bank Of Scotland
Santander
Scottish Widows
Tipton & Coseley Building Society
West Bromwich Building Society
Example financial reference letter
An example of a financial reference letter given by a member in support of a mortgage application for
a client is set out below. Please note that mortgage applications offer opportunity for fraud and
therefore members should carefully check the reasonability of all financial references before providing
them and never be associated with the presentation of facts that are known or believed to be incorrect
or misleading.
Dear Sirs
Mortgage application by ................ and application reference number..............
Our above named client has asked us to provide a reference in support of a proposed loan by you of
£................ repayable by monthly instalments of £........ over .... years.
We have been engaged by our client to prepare his self-assessment returns for his approval before
we submit them to HM Revenue & Customs and have acted in this capacity for ....... years. These
returns are based on the information provided to us by our client.
Our client’s net income in the year ended 5 April ........after charging all business costs was £.........
[Details of earlier years may be added as appropriate.]
We have no reason to suppose that our client would undertake any commitment which he did not
expect to fulfil; however we make no assessment of our client’s continuing income or future
outgoings.
This reference is provided in good faith and the above statements are made to the best of our
knowledge and belief. However, we accept no liability to you or any other party who may seek to
rely on this reference.
Yours faithfully
Member’s name
Chartered Tax Adviser/ Taxation Technician
Version 1.4 (06 August 2015)
HMRC Guidance for Lenders
Page 1 of 28
Contents
Disclaimer
3
Background
4
What Lenders can ask for
4
What this guide is for
4
Section 1 – Customers Online Self Assessment printed documents
5
The Online Tax Calculation explained
6
The example Online Tax Calculation
7
HMRC Self Assessment online version of the Tax Calculation
8
HMRC Self Assessment online version of the Tax Calculation continued
9
How your customers can get a copy of their HMRC online Tax Calculation
10
The Online Tax Year Overview explained
11
HMRC online version of the Tax Year Overview
13
How your customer can get a copy of their online HMRC Tax Year Overview
14
Section 2- Customers who send a paper Tax Return by post
15
HMRC paper SA302 Self Assessment Tax Calculation explained
16
The example paper SA302 Self Assessment Tax Calculation
17
HMRC paper SA302 Self Assessment Tax Calculation
18
Section 3 – Customers who are unable to print from an online account
20
Tax Calculation and Tax Year Overview issued by HMRC Call Centres explained
21
The example Tax Calculation printed by HMRC Call Centre
22
HMRC Call Centre printed Tax Calculation
23
The example Tax Year Overview printed by HMRC Call Centre
24
HMRC Call Centre printed Tax Year Overview
25
Annex 1 - Examples of commercial software (printed) Tax Calculations
26
Updates made to this version of the guide
28
Page 2 of 28
Disclaimer
1. HMRC logo is protected by copyright and cannot be reproduced but Lenders can copy,
duplicate and reproduce all other information contained in this guidance pack.
2. These notes are for guidance only and reflect the position at the time of writing.
3. HMRC will review and update this guidance annually.
4. The HMRC examples used in this guidance pack are for illustrative purposes only.
Customers’ own documents will represent their personal circumstances.
5. Customers can send their income on their tax return before the due date which is the 31st
January. Lenders are reminded that we would not necessarily expect a payment before 31st
January, as the final payment is not due until then.
6. HMRC work out the Tax Calculation from the return details and the final tax position will
show on the Tax year Overview screen, within the 72 hours of HMRC receiving it.
7. HMRC call centre staff cannot engage directly with Lenders, where a Lender needs to seek
further verification of the documentation, those Lenders signed up to the Mortgage
Verification Scheme can make a request through that service.
8. Self Assessment documentation confirms the income the customer has declared to HMRC
at the time of printing. The Tax Year Overview shows the tax the customer has paid
towards the tax payable quoted on the Self Assessment documentation at the time of
printing. Lenders should consider obtaining, where necessary, other evidence about a
borrower’s income to satisfy their suitability for a loan.
Page 3 of 28
Background
In 2014 the Financial Conduct Authority introduced new rules for Lenders that require them to
make sure borrowers can afford their repayments, now and in the future. To do this Lenders
collect information about borrowers’ income and expenditure.
Since the change, HMRC have experienced a huge increase in Self Assessment (SA) customers
(mostly self-employed) asking us to send them a paper copy of their ‘Tax Calculation’ (commonly
known as the SA302) to support mortgage applications. These paper copies are the same
information that a customer can view and print from their official online SA account.
HMRC have consulted with the CML Lending Strategy and Practice Panel to understand Lenders’
needs and reach agreement over changes HMRC could make to the online SA account to support
Lenders accept online documents. HMRC have now made the necessary changes and are now
recommending that Lenders advise those customers who have an online SA account, to print
their own HMRC documentation. They can print the Tax Calculation and the Tax Year Overview,
which together provide information on the income the individual has declared to HMRC and how
much they have paid of the income tax due on their SA income.
This guide explains the different versions of these documents and the different ways that
customers can obtain the Tax Calculation and Tax Year Overview. For example customers:
 who send their tax return through their HMRC SA online account, can print at any time both
documents from their online account.
 who send a paper tax return, will automatically get a paper SA302 Tax Calculation when
HMRC process their return.
 who send their return using commercial software, can print of their Tax Calculation through the
software, but they will need to be registered for and log into their official online SA account to
print their Tax Year Overview.
 can ask HMRC to send them copies of both documents from their records.
What Lenders can ask for
They can ask for a:
 Tax Calculation, showing the customer’s self reported income and it also shows HMRC
calculation of the tax due on that income and
 Tax Year Overview, showing the total tax due and how much the customer has paid in tax
direct to HMRC.
Note: these documents should not be confused with Annual Tax Summaries (ATS), the purpose
of the ATS is to show how an individual’s tax and National Insurance is spent. It details the taxable
income and tax and National Insurance due, but is only available from 2013/14. SA customers
can access their ATS from their online SA account, and it will be updated with any changes.
Lenders dealing with customers in person could suggest the customer brings their HMRC SA log
in details with them, so they can log in and print off the documents when they are with them.
What this guide is for
HMRC are not mandating this guide to Lenders, it explains what is available to them that
customers can self-serve from their online account. It will also help Lenders to understand what
documentation SA customers can provide about their income and how to interpret it.
Page 4 of 28
Section 1
Customers Online Self Assessment printed documents
Page 5 of 28
The Online Tax Calculation explained
When the customer submits their SA tax return (for a particular year) through their HMRC SA
Online account the system will create an online Tax Calculation from the information supplied. It
shows the customer’s taxable income and we work out what tax the customer needs to pay or how
much is due back to them.
The customer’s Tax Calculation is correct at the time of print, however the customer has a legal
right to change their tax return if they need to correct it, which will in turn change their SA Tax
Calculation and Tax Year Overview. The deadline for corrections is usually 12 months after the
tax return deadline (31st January). If they miss this deadline they can still write to HMRC asking
for any corrections be considered for up to 4 years after the end of the tax year.
Lenders are advised that at the moment customers can only view and print up to 3 years Tax
Calculations from their online SA account. However from April 2016 onwards they will be able to
view and print up to 4 years.
Whilst HMRC work to make more years available, we recommend Lenders look to the Tax Year
Overview which is available for the last 4 years and other evidence about borrower’s income to
satisfy their suitability for a loan. In some cases we accept this goes against lending regulations
and accept we will need to continue to support those customers by providing additional Tax
Calculations.
Please Note: many accountants and some customers use commercial software to send their
return. The customer will not be able to print a Tax Calculation from their SA Online account if
they have used commercial software to send their return. HMRC recommends that lenders
accept equivalent online Tax Calculations produced using commercial software if supported by an
HMRC Tax Year Overview. See more about Commercial software on page 25.
Company Directors: company directors are not self-employed but employees of the
company. They will (like every other employee) have a P60 certificate showing their earnings and
tax paid from that employment. As a director they will also be required to submit a tax return
annually, so will have a Tax Calculation and a Tax Year Overview, these will detail all income
returned to HMRC.
Lenders can decide if they will accept the P60, if that covers affordability aspect or if they need to
see the Tax Calculation and Tax Year Overview.
Page 6 of 28
Use the guidance below together with the example image of the Tax Calculation on page 8 & 9.
The example Online Tax Calculation shown contains:
1. The HMRC logo, Unique Tax Reference (UTR), the customer’s name and the tax year.
2. A progress bar that tells you if the return is complete. The bar needs to show ‘your tax return
is 100% complete’ before HMRC has received it. We explain this by the stating on the
document “This section provides you with a breakdown of your full calculation. If it says your
tax return is 100% complete then you have submitted this return and this is a copy of
information held on your official online SA tax account with HMRC”.
3. Lenders will be interested in the “Total Income received”. In the example the total
income is £85,307.00. This figure is made up of the customer’s taxable income, such as
employment and benefits. It will not include any non-taxable income, for example:
 Tax Credits and some state benefits (for example Income Support)
 income from tax-exempt accounts (for example Individual Savings Accounts (ISAs)
 income from the rent a room scheme (currently £4,250.00).
For more information go to gov.uk/income-tax
4. If the customer was self-employed any amount shown as profits are net profit, they do not
include business expenses or Capital Allowances. You should look to other evidence for
these details for example the customer’s business accounts.
5. The next part of the calculation shows how HMRC has worked out the customer’s tax (using
the appropriate tax rates) after taking off:
 their tax free personal allowance
 any other adjustments, for example allowable PAYE expenses, business expenses
and capital allowances.
The final amount will be shown as Tax due. In this example “Tax and Class 4 National
Insurance contributions due” is £31,622.35.
6. Below this, we include any amounts taken from the customer’s income for tax purposes
before they are paid, for example:
 tax deducted through PAYE by an employer
 tax taken off investments
 deductions made by contractors under the Construction Industry Scheme (CIS).
Contractors are responsible for taking off a deduction (usually 20 per cent) to cover any tax
or National Insurance before paying their subcontractors. In this example the CIS
deductions is £10,421.00, the CIS profit above ‘Total income received’ as profit, is shown
in this example as £46,800.00. The total amount the customer paid before receiving their
income will be shown as “Total Tax deducted” in this example that amount is £15,481.75.
7. Lenders will also be interested in the “Income tax and National Insurance due”. This is
the amount that the customer will have to pay direct to HMRC. This figure will also show
on the Tax Year Overview. In this example that amount is £16,140.60. You must make
sure this “matches”, the “Tax” figure (sometimes known as a balancing payment) in the
Tax Year Overview.
8. Please note: Some customers need to make payments towards their tax bill for the next
year in advance of sending their return. This is determined by how much tax is due from
the previous year’s return and how much they have had deducted before receiving their
income, we call these ‘payments on account’ and they are normally paid in 2 equal
instalments. The Tax Calculation will show any payments on account for next year.
Page 7 of 28
HMRC Self Assessment online version of Tax Calculation
1
2
3
Page 8 of 28
HMRC Self Assessment online version of Tax Calculation continued
5
6
7
Page 9 of 28
How your customers can get a copy of their HMRC online Tax Calculation
The easiest and quickest way for customers to get a Tax Calculation is to print the document from
their online Self Assessment account.
For more information go to gov.uk/sa302-tax-calculationCustomers can print the Tax
Calculation using the following steps:
Tell your customer to:
1. Log into their HMRC online account (go to online.hmrc.gov.uk/login)
2. Select ‘Self Assessment’ (if they are only registered for Self Assessment then they will be
automatically be directed to this screen)
3. Follow the link ‘View Your Tax Return’
4. Follow the link ‘tax return options’.
5. Choose the year from the drop down menu and select the ‘Go’ button
6. Select ‘view return’ button
7. Follow the link ‘view calculation’
8. Follow the link ‘view and print your calculation’
9. Follow the link at the bottom of the page to 'print your full calculation'
Reminder: At the moment customers can only view and print up to 3 years Tax Calculations from
their online SA account. However, from April 2016 onwards they will be able to view and print up
to 4 years.
Whilst HMRC work to make more years available, we recommend that Lenders look to the Tax
Year Overview which is available for the last 4 years and other evidence to about borrower’s
income to satisfy their suitability for a loan.
We understand this goes against lending regulations in some cases, in these cases we will
continue to issue copies of Tax Calculations until more years become available.
If the customer cannot print online go to section 3 for further details.
Please Note: many accountants and some customers use commercial software to send their
return. See more about Commercial software on page 26.
Page 10 of 28
The online Tax Year Overview explained
The Tax Year Overview shows the amount of tax due to be paid direct to HMRC or any available
amount for refund, for that actual tax year from the latest return (or correction) received.
HMRC needs at least 72 hours to process the tax return (or correction) before the final figures will
show on the customer’s online account. The customer will need to wait until we have processed
their return (or correction) to get a matching Tax Year Overview.
If the customer tries to print the Tax Year Overview within 72 hours of submitting the return (or
correction) the figures will not match the calculation. It may show:



no tax due or
if they have been asked to make payments on account based on the previous tax return; the
Payment on Account or
if they have corrected their return; the original amount of tax due to be paid before the return
was corrected.
The Tax Year Overview will show Lenders if any payments have been made by the customer to
HMRC towards the amount due. Lenders can use this to support what the Tax Calculation shows.
The Tax Year Overview will contain information such as:
1. The HMRC logo, the customer’s name and their Unique Tax Reference (UTR) number
Note: exceptionally the customer may have legally authorised someone to act on their behalf.
We call them a capacitor and their name will be on the Tax Year Overview. We recommend in
these cases these customers contact HMRC for a Tax Year Overview which we will send with
a cover letter confirming our records show the capacitor is acting for the customer.
2. The tax year (this allows cross reference with the Tax Calculation).
3. The statement - “This is a copy of information held on your official online Self Assessment tax
account with HMRC”.
4. How much tax is due for that tax year: if the amount is a negative figure (minus) this means the
customer has overpaid tax and is due money back. The Tax figure should match the ‘Tax
Calculation’. In this example £16,140.60.
Note: if the figure does not match firstly check both documents are prints of the latest version.
If the customer or HMRC has made a correction to the return any old copies will be out of date.
There are a couple of issues which can make the figures appear different. We must stress
these issues affect an extremely small minority of customers of less than 5%.
You can accept documents match if you identify the discrepancy as one of the reasons below:
1. Where we arrange to collect an amount for underpaid tax through the customers PAYE
code from one tax year into the next. This is easy to identify on the calculation document
(see below for content to look for). The difference in the two figures will equal the amount of
underpaid tax. The calculation will include one of the following entries:
Page 11 of 28

‘underpaid tax for YYYY-YY [the year in question] included in your code for YYYY-YY’ [the
following year]. If you add this amount the tax due figure on the calculation it will match the
Tax Year Overview

‘Underpaid tax for earlier years in your tax code for YYYY-YY’. If you deduct this amount
from the tax due figure on the calculation it will match the Tax Year Overview.
2. Student Loan repayments: where the difference in the two figures equal:


the pence due on Student Loan repayments – PAYE Student Loan (SL) deductions made
by employers do not include pence but amounts calculated by Self Assessment (SA) do.
The Tax Calculation and the Tax Year Overview has highlighted this and will sometimes
show this difference.
an amount up to the amount required to fully repay a customer's Student Loan. In the final
year of a customer's loan term, their Tax Calculation will show the amount that can be
collected from their level of income. If that full amount is not due because it would exceed
the amount required to fully pay off the loan, we will make an informal adjustment to their
account to reduce the amount due which will not show on the Tax Calculation. In these
cases (only 0.04% of all Self Assessment customers) we will send the customer an OCA170
letter explaining what has been repaid to them.
5. Any payments the customer has made towards their tax bill. In this example £15,059.40.
6. The Tax Year Overview may also show charges and payments for penalties and surcharges
these are for late filing or late payment, there are not dependant on customers’ income.
Page 12 of 28
HMRC online version of the Tax Year Overview
Customers must wait 72 hours after submitting (or correct) their SA Tax return or making a
payment before printing their ’Tax Year Overview’ otherwise it will not match the Tax Calculation.
1. In this example the customer has filed their 2013/14 return.
2. The tax due figure is £16,140.60.
3. The customer has also paid payments on account for their 2013/14 tax return of £15,059.40
(this amount is calculated on the 2012/13 tax due figure). Once the customer submits their
2014/15 return and a Tax Calculation is produced the figure on the Tax Year Overview will
be updated with the actual amount due.
1
2
3
1. In the example below if the customer produces a Tax Year Overview for 2014/15, Lenders
will know that it is not due until April 2015 and tax return will not have been submitted.
2. The total £5,032.64 is an estimate of the tax due expected.
3. Check both entries for Tax year ending 05 April YYYY show the same year to be sure the
information is for the correct year.
1
2
3
Page 13 of 28
How your customers can get a copy of their online HMRC Tax Year Overview
The easiest and quickest way for customers to get a Tax Year Overview is to print the document
from their online Self Assessment account.
For more information go to gov.uk/sa302-tax-calculation
Customers can print the Tax Year Overview using the following steps:
Tell your customer to:
1. Log into their HMRC online account (go to online.hmrc.gov.uk)
2. Select ‘Self Assessment’ (if you are only registered for Self Assessment
then you will
2
automatically be directed to this screen)
3. Follow the link ‘Self Assessment Overview’
4. Follow the link ‘view account’
5. Follow the link ‘tax years’
6. Choose the year from the drop down menu and select the ‘Go’ button
7. Follow the link ‘print your Tax Year Overview’.
Repeat steps 5 – 6 for any earlier years.
Customers must wait 72 hours after fully submitting (or correcting) their Self Assessment Tax
return or making a payment before printing their ’Tax Year Overview’.
Page 14 of 28
Section 2
Customers who send a paper Tax Return by post
Page 15 of 28
HMRC paper SA302 Self Assessment Tax Calculation explained
When a customer sends their tax return by post, HMRC will automatically send a paper copy of
the Tax Calculation to the customer, after the return has been processed by HMRC staff. This is
the paper equivalent of the online version. The layout is slightly different but it contains the same
information as the online Tax Calculation.
Page 1 is the introduction to the Tax Calculation. It gives details of the final amount due from the
submitted return along with any payments on account for that year, and any payments on account
calculated for the following year.
As explained earlier in the guide, some self-employed customers need to make payments towards
their tax bill for the next year in advance of sending their return. We call these payments on
account and they are normally paid in 2 instalments of the amount due from the previous years’
return.
If the customer chooses to send their return by paper, they are unlikely to have access to an
online account. As a result they will not be able to access and print a Tax Year Overview.
In these cases the customer can either register for our online service to be able to print a Tax Year
Overview or contact HMRC and we will send them a copy.
Note: the paper Tax Calculation issued by HMRC has the reference SA302 in the bottom left hand
corner on page 1. The full Tax Calculation will always appear on a page 3 (see example below:
the customer may not always get a page 2. If the customer’s information on page 1 about
payments becoming due does not run to 2 pages then there will be no page 2 – The calculation
itself will always start on page 3).
Page 16 of 28
Use the guidance below together with the example image of the SA302 Tax Calculation on page
18 & 19.
The example paper SA302 Self Assessment Tax Calculation contains:
1. The HMRC logo, the customer’s name, Unique Tax Reference (UTR) number and the tax
year.
2. A summary of the result of the calculation, and the various payments that will be asked for. In
this example the total tax due for 2013/14 £15,065.78.
3. Lender will be interested in the “Total Income received”. In this example the total income is
£82,700 on page 19. This figure is made up of the customer’s taxable income, such as
employment and benefits. It will not include any non-taxable income, for example:
 Tax Credits and some state benefits (for example Income Support)
 income from tax-exempt accounts (for example Individual Savings Accounts (ISAs)
 income from the rent a room scheme (currently £4,250.00).
For more information go to gov.uk/income-tax
4. If the customer was self-employed any amount shown as profits are net profit, they do not
include business expenses or Capital Allowances. You should look to other evidence for these
details for example the customer’s business accounts.
5. The next part of the calculation shows how HMRC has worked out the customer’s tax (using the
appropriate tax rates) after taking off:
 their tax free personal allowance
 any other adjustments, for example allowable PAYE expenses, business expenses and
capital allowances.
The final amount will be shown as Tax due. In this example “Tax and Class 4 National
Insurance contributions due” is £31,041.55.
6. Below this, we include any amounts taken from the customer’s income for tax purposes before
they are paid is shown, for example:
 tax deducted through PAYE by an employer
 tax taken off investments
 deductions made by contractors under the Construction Industry Scheme (CIS).
Contractors are responsible for taking off a deduction (usually 20 per cent) to cover any tax or
National Insurance before paying their subcontractors. In this example the CIS deductions are
£10,421.00, the CIS profit is shown above ‘Total income received’ as ‘profit from selfemployment’, in this example £46,800.
The total amount the customer paid before receiving their income will be shown as “Total Tax
deducted” in this example that amount is £15,975.77.
7. Lenders will also be interested in the “Income tax and National Insurance due”. This is the
amount that the customer will have to pay direct to HMRC. This figure will also show on the
Tax Year Overview. In this example that amount is £15,065.78. You must make sure this
“matches”, the “Tax” figure (sometimes known as a balancing payment). in the Tax Year
Overview.
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HMRC SA302 Self Assessment Tax Calculation
1
2
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4&6
3
5
6
6
7
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Section 3
Customers who are unable to print from an online account
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Tax Calculation and Tax Year Overview issued by HMRC Call Centres explained
If a customer is unable to print from an online account they can contact HMRC and ask for copies
of both the Tax Calculation and Tax Year Overview to be sent to them.
HMRC appreciate there are some circumstances where this is unavoidable, however we would
like to keep this contact to a minimum because it is detracting from our core business of helping
customers to pay the correct amount of tax.
The Tax Calculation shows the customer’s taxable income and we work out what tax the customer
needs to pay or how much is due back to them.
The customer’s Tax Calculation is correct at the time of print, however the customer has a legal
right to change their tax return if they need to correct it. The deadline for corrections is usually 12
months after the tax return deadline (31st January). If they miss this deadline they can still write to
HMRC asking for any corrections be considered for up to 4 years after the end of the tax year.
The Tax Year Overview shows the amount of tax due to be paid direct to HMRC or any available
amount for refund, for that actual tax year from the latest return (or correction) received.
HMRC needs at least 72 hours to process (or correct) the tax return before the final figures will
show on the customer’s account. The customer will need to wait until we have processed (or
corrected) their return to get up to date matching documents.
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Use the guidance below alongside the example image of the Tax Calculation on page 23.
The Example Tax Calculation printed by the HMRC Call Centre contains:
1. The HMRC logo, Unique Tax Reference (UTR), the customer’s name and the tax year.
2. Lenders will be interested in the “Total Income received”. In this example the total
income is £50,649. The figure is made up of the customer’s taxable income, such as
employment and benefits. It will not include any non-taxable income, for example:
 Tax Credits and some state benefits (for example Income Support)
 income from tax-exempt accounts (for example Individual Savings Accounts (ISAs))
 income from the rent a room scheme (currently £4,250.00).
For more information go to gov.uk/income-tax
3. If the customer was self-employed any amount shown as profits are net profit, they do not
include business expenses or Capital Allowances. You should look to other evidence for
these details for example the customers’ business accounts.
4. The next part of the calculation shows how HMRC has worked out the customer’s tax (using
the appropriate tax rates) after taking off:
 their tax free personal allowance
 any other adjustments, for example allowable PAYE expenses, business expenses
and capital allowances.
The final amount will be shown as Tax due. In this example “Income Tax charged” is
£10,039.75.
5. Below this, we include any amounts taken from the customer’s income for tax purposes
before they are paid is shown, for example:
 tax deducted through PAYE by an employer
 tax taken off investments
 deductions made by contractors under the Construction Industry Scheme (CIS).
Contractors are responsible for taking off a deduction (usually 20 per cent) to cover any tax
or National Insurance before paying their subcontractors.
The total amount the customer paid before receiving their income will be shown as “Total
Tax deducted” in this example that amount is £7,980.75.
6. Lenders will also be interested in the “Total Income tax due”. This is the amount that the
customer will have to pay direct to HMRC. This figure will also show on the Tax Year
Overview. In this example that amount is £1,974.10. You must make sure this “matches”,
the “Tax” figure (sometimes known as a balancing payment) in the Tax Year Overview.
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HMRC Call Centre printed Tax Calculation
The Call Centre Tax Calculation contains the same information as the customer’s online print.
1
2
4
5
6
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Use the guidance below together with the example image of the Tax Year Overview on page 25.
The example Tax Year Overview printed by HMRC Call Centre contains:
1. The HMRC logo, the customer’s name and their Unique Tax Reference (UTR) number
Note: exceptionally the customer may have legally authorised someone to act on their behalf.
We call them a capacitor and their name will be on the Tax Year Overview, in these cases we
will send with a cover letter confirming our records show the capacitor is acting for the
customer.
2. The tax year (this allows cross reference with the Tax Year Overview)
3. The statement - “This is a copy of information held on your official online Self Assessment tax
account with HMRC”.
4. How much tax is due for that particular tax year. If the amount is a negative figure (minus) this
means the customer has overpaid tax and is due money back. The Tax figure should match
the ‘Tax Calculation’.
Note: if the figure does not match firstly check both documents are the latest version. If they
are, one possible explanation is where HMRC have identified during the year an issue with
their PAYE coding. You can identify these cases by the entry on the Tax Calculation for
‘Underpaid tax for YYYY-YY [the year in question] included in your code for YYYY-YY’ [the
following year]. If you add the amount of ‘Underpaid tax for YYYY-YY’ included in your code
for YYYY-YY’ to the tax due figure on the Tax Calculation it will be the same amount shown as
‘Tax’ on the Tax Year Overview. This situation is uncommon.
5. Any payments the customer has made towards their tax bill. In this example the customer has
not paid anything direct to HMRC for 2013/14 at time of printing.
6. The Tax Year Overview may also show charges and payments for penalties and surcharges
these are for late filing or late payment, there are not dependant on customers’ income.
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HMRC Call Centre printed Tax Year Overview
The HMRC Call Centre printed Tax Year Overview contains the same information as the
customer’s online print.
1
2
3
4
5
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Annex 1 - Examples of commercial software (printed) Tax Calculations
Many accountants and some customers use commercial software to send their return. HMRC
recommends that lenders accept equivalent online Tax Calculations produced using commercial
software if supported by an HMRC Tax Year Overview.
All commercial software providers offer a Tax Calculation, these show the customer’s name and
Unique Tax Reference number and display a similar breakdown of income and tax deducted, with
the net result from that return. The Tax Year Overview will confirm the details in the commercial
printed Tax Calculation, that this has been submitted to HMRC. The customer or their accountant
can access their online account to print a Tax Year Overview (see page 13).
HMRC are not responsible for commercially produced Tax Calculation but have reproduced some
(not the full range) examples below.
Example 1
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Example 2
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Updates made to this addition
August 2015
1. Page 11 and 12 added clarity around tax underpayments included in PAYE codes and
Student Loan Repayments.
2. Where applicable in guide updated that from April 2015 the customer can print up to 3
years Tax Calculations.
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Version 1.2 (9th Sept 2015)
Quick guide to printing your clients HMRC online Tax Calculation and Tax Year Overview
Before you can access your client’s information, you need to be an authorised agent.
If you’re not, go to: https://www.gov.uk/guidance/applying-for-client-authorisation-using-hmrconline-services
Once you’re authorised, you can use HMRC Online Services to:
 manage your client lists

send tax returns

exchange information with HMRC online
If you can’t access and print online documents or the lender asks for paper copies, contact HMRC
Self Assessment Helpline and we will send them to you.
Printing your client’s Tax Calculation (SA302)
If filing using HMRC software you can currently view and print up to 3 years Tax Calculations, but this
will increase to 4 years from April 2016.
1. Log in to your agent online account.
2. Choose the relevant client from the authorised client list.
3. Follow the link ‘tax return options’.
4. Choose the year from the drop down menu and click the ‘Go’ button.
5. Select the ‘view return’ button.
6. Follow the link ‘view calculation’ from the left hand navigation menu.
7. Follow the link ‘view and print your calculation’ at the bottom of the page.
8. Follow the link ‘print your full calculation’.
Printing your client’s Tax Year Overview
1. Log in to your agent online account.
2. Choose the relevant client from the authorised client list.
3. Follow the link ‘view account’.
4. Follow the link ‘tax years’ from the left hand navigation menu.
5. Choose the year from the drop down menu and click the ‘Go’ button.
6. Follow the link ‘print your Tax Year Overview’.
You must wait 72 hours after fully sending a tax return until you can print your documents.
Version 1.4 (9th Sept 2015)
Quick guide to printing copies of HMRC online Tax Calculation and Tax Year Overview
Tax Calculation
The easiest and quickest way to get a Tax Calculation is to print a copy from the
 HMRC online Self Assessment account
 commercial software that was used to submit the return.
Note: you can now print 3 years tax calculations (2012/13 onwards) from your HMRC online account
provided you have fully submitted your return online - this will increase to 4 years from April 2016.
How to print a Tax Calculation from your HMRC online account
1. Log into the HMRC online account (go to online.hmrc.gov.uk) – the ‘security message’ page will
now be shown
2. Select ‘next’ to continue
3. Follow the link ‘Self Assessment details and options’ on the Self Assessment home page - the
‘current position’ page will now be shown
4. Follow the link ‘tax return options’
5. Choose the year from the drop down menu and select the ‘Go’ button
6. Select the ‘view return’ button
7. Follow the link ‘view your calculation’ from the left hand navigation menu.
8. Follow the link ‘view and print your calculation’ at the bottom of the page.
9. Follow the link at the bottom of the page to 'print your full calculation'
How to print a Tax Year Overview from your HMRC online account
1. Log into the HMRC online account (go to online.hmrc.gov.uk) – the ‘security message’ page will
now be shown
2. Select ‘next’ to continue
3. Select either ‘Self Assessment Account’ or ‘Self Assessment’ (the link shown will depend on what
services you are registered for) – the ‘current position’ page will now be shown
4. Follow the link ‘tax years’ from the left hand navigation menu.
5. Choose the year from the drop down menu and select the ‘Go’ button
6. Follow the link ‘print your Tax Year Overview’.
Repeat steps 5 – 6 for any earlier years
Please note: You must wait 72 hours after fully submitting your return until you can print your
documents.